What is a 203K Loan?
The 203K loan is a Rehabilitation Loan from FHA. A 203K allows a borrower to purchase or refinance a home and include money for repairs or renovations into one loan for one monthly payment.
It's a great way for buyers to purchase homes that are in disrepair or homes that need cosmetic upgrades, and may have been sitting on the market for a while. In many cases these homes are priced lower than homes in similar markets that are move-in ready.
The 203K loan is for owner-occupied properties only. This is not an investor loan product.
Types of Renovations and Repairs
Here are just some examples of renovations and repairs that can be included in a 203K loan:
- Foundation repairs
- Roof replacement
- Painting - interior or exterior
- Kitchen or Bathroom renovation
- New Flooring
Unfortunately, luxury repairs and additions can not be included in a 203K loan. For example: pools, hot tubs. barbecue pits
Benefits of a 203K Loan
- Repairs and purchase can be rolled into one loan
- Low down payment traditional FHA loan known as a 203b
- Seller can pay portion of closing costs
- Money is distributed after closing with draws, intermittent payments during construction, to the Contractor
How Can I Help You?
At Jersey Mortgage Company, we are 203K experts and have staff dedicated to working with 203K borrowers. We understand the 203K loan process and work to make every loan a success!
As a mortgage loan officer with Jersey Mortgage Company, I can assist borrowers in New Jersey, Connecticut, Florida and Pennsylvania with getting pre-qualified for a home loan.
By offering information and educating clients on the mortgage loan process and servicing each borrower's individual needs, and partnering with Realtors to create a seamless transaction, I am able to exceed expectations and ensure that deals are closed on time!
Please Note: This article is provided for illustrative purposes only. It is not an offer or commitment to lend money, and it is not an advertisement for a specific mortgage or a specific interest rate. Contact me to run the numbers for your situation.